Disaster relief as a model for corporate crises

What companies can learn from disaster relief

Crises are part of everyday life, for companies too. While just a few years ago the impression prevailed that crises came in tolerable doses, since the coronavirus pandemic at the latest there have been increasing signs that some crises can escalate into disasters.

In Germany in particular, corporate crises are currently dominating our perception. For example, the automotive industry is facing major challenges and my former employer in the pharmaceutical industry has been teetering on the brink since it was taken over by an American corporation; many of my former colleagues have left (or been forced to leave) the company or are working in constant fear for their jobs due to the company’s share price.

The topic of job crises is also becoming more prevalent in my coaching sessions; often it is about job loss and lengthy job searches. At the same time, conservative politicians are calling for ‘more work’. ‘Yes, where?’ and ‘How do you get the supposedly so many vacancies?’ I often ask myself when desperate, well-trained coachees are looking for a new and, above all, adequately paid job. In my admittedly subjective observation, the shortage of skilled workers and the application marathon do not really go together.

But complaining that companies and politicians have missed the signs of the times or that state funding is maintaining the old instead of investing in the new does not help us. Crises and sometimes even catastrophes are part of life – this applies to companies no less than to individuals.

My suggestion:

Instead of always just complaining, we should focus on crisis and catastrophe skills in challenging times.

How specialised organisations respond to crises

Let’s take a look beyond the corporate horizon: in Germany, there are some excellent organisations that provide disaster relief. What do organisations like the Federal Agency for Technical Relief or the fire brigade do to be able to respond appropriately to crises and disasters?

Junior Professor Danner-Schroeder has analysed the approach of these organisations and derived important insights for organisational resilience. [1] In the process of disaster relief, two phases can be observed on the ground:

In the first phase, there is a certain chaos.

The disaster relief workers arrive at the scene, familiarise themselves with what is happening and create a basis for the flexible action that will be needed later in the unknown. This basis includes the rapid establishment of (familiar) structures, such as always using the same base camp, as well as an initial reduction in complexity by setting initial priorities for the actual disaster management that follows.

The first phase provides orientation and promotes the necessary sense of security. It thus creates indispensable conditions for being able to act appropriately in the subsequent phases; this requires an expanded perception of the situation by the helpers and clear guidelines on how to proceed in phase 1.

The second phase is about the actual crisis or disaster management.

Here it is important to react, to act and to learn from the situation. In disaster relief, practised routines are flexibly combined and adapted to the situation in this second phase.

In addition, there are clear processes before and after the actual operations:

• Before operations, routines must be practised and plans for setting up the base camp must be drawn up. It is important that the camp is set up independently of local conditions so that everyone involved is familiar with how to use it.
• After the crisis, there are lessons learned, on the basis of which routines are adapted and plans modified. This is how the expertise of all those involved grows.

The benefits of disaster relief for companies

This type of step-by-step approach can also be applied to crises in companies. In particular, in a production environment, where the failure of production units can lead to a corporate disaster, it seems to me to be perfectly suitable. Taking the failure of central IT components in a data centre as an example, this would mean (simplified representation):

• There are emergency plans including technical dependencies and applications are prioritised according to their criticality to the business; employees are familiar with recovery plans and procedures including data recovery.
• When a failure is detected, a crisis centre is set up. A task force is formed there to make decisions.
• After an initial vote, the employees involved work to restore the IT infrastructure. They use defined recovery routines that have to be flexibly combined and adapted.
• The employees keep returning to the crisis centre to exchange information, thus also reducing personal stress, because the crisis centre is a familiar place where they also satisfy their basic needs such as eating and drinking.
• Even simple things like formally arranging for the statutory working hours to be exceeded while observing the necessary breaks – if necessary in the form of an ad hoc arrangement – relieve the employees tasked with troubleshooting.
• Once the disruption has been resolved and all those involved have had an appropriate period of rest, the operation is evaluated. The restart routines are adapted, application priorities are modified if necessary and training requirements for employees are derived, because experience and expertise play a crucial role in crises.

From my business experience, I know that many data centres have established such processes for failures. What is often missing:

• It is not the decision-making centre that is missing, but the need for a supply base for employees is underestimated – and yes, this includes coffee and biscuits. Whether and how the supply base is set up is individual and also depends on the assessment of the managers responsible for the operation.
• Preparation and follow-up are neglected in day-to-day business and due to resource bottlenecks.
• The extended perception is not trained.

Of course, corporate crises do not only occur in productive organisational units or environments with established processes and routines. Dealing with events that affect the entire company, for example in the form of an economic threat, cannot be managed by the situational recombination of routines alone.

But here, too, the framework developed in disaster relief can be helpful: Setting up a prepared crisis centre and appointing a (predefined) task force – here perhaps more a kind of project team with a central project room – creates structures. Experts with different perspectives can be convened and develop concepts that then have to be tested and modified in small steps. Here, too, the familiar is recombined in new ways, and learning takes place in the process itself and in the form of targeted lessons learned. [2]

What do crises and disasters do to the people in companies?

Not surprisingly, but important and quickly forgotten in a professional context, especially in crises and disasters: managers and employees are just normal people. Crises or even disasters therefore do nothing to them in a professional context that we are not familiar with from our private lives: they create fear and can even cause or trigger traumatic experiences. [3]

In my view, it is therefore worth taking a look at so-called trauma research when it comes to the topic of corporate resilience. Without being dramatic, the likelihood of (re)traumatisation in and by companies in this country is rather low, unless the crisis involves a serious accident. [4] Trauma research also views the outrage (about managers, processes, customers, etc.) that can be observed in crises, including aggression, hatred and conspiracy theories, as a possible way of processing threatening experiences.

What seems relevant to me here is that all of this has an anxiety-reducing effect and can therefore be an entirely expected phenomenon in corporate crises, hindering or even preventing constructive action. Trauma research can be used to derive countermeasures here.

Overcoming corporate crises with the help of trauma research

In trauma research, the recovery of individual agency and control over one’s own emotions plays an important role. With regard to corporate crises, it is particularly worthwhile to take a look at research on group-wide traumatisation and what helps to overcome or avoid it.

As in the individual sphere, the topic of security – now in the group – plays a central role. Both the sense of connection with (the members of) the group and a perceived (shared) gain in control in the crisis are important. This gives rise to aspects that companies should consider:

• People want to help shape events, but of course this is not always possible across the board in acute crises. In this case, adequate communication that takes into account the need for control and security of those affected is crucial.
• Due to the evolutionary strategy of the Homo Sapiens species, it is a primal human need to be connected to others and to trust them; in crises, it is therefore absolutely counterproductive to separate or unsettle people, as this reduces their ability to perform.

Here are some insights from dream research that can also be applied to companies:

1. Strengthen informal networks.
2. Create meeting spaces, such as a ‘war room’ (what a terrible name for such a wonderful, anxiety-reducing tool) or spaces for those only indirectly affected, where they can receive information or address their concerns.
3. Use positively connoted memories in economic crises. The good old days bring people together, even when cuts and changes are necessary. Aspects of the new can be integrated into long-standing rituals such as the annual company party. This is how you combine necessary changes, which are sometimes difficult for those affected, with a culture of remembrance.
4. Create shared symbols. In critical projects and task forces, you will often find a stuffed animal or something similar. It often has a name and represents an important task. The conscious use of an old, positively connoted symbol for an upcoming crisis intervention or transformation is also possible in the sense of a positive culture of remembrance.

Of course, it makes sense to distinguish between a short-term crisis, such as the failure of an IT infrastructure, and a longer-term, sometimes existential threat to the company due to economic problems. In the first case, the measures to be taken will tend to be concerned with stabilising the team working on the crisis management, whereas in the second case, the group of people to be involved is likely to be significantly larger.

Conclusion

Disaster research can help us to identify important skills for resilient organisations. Above all, it is important to be well prepared for possible crises – the earlier, the better. This preparation includes both organisational aspects (routines, targeted development of key experts) and employee skills (strengthening self-efficacy, expertise, sense of security, perceptual skills).

In the crisis itself, a two-phase approach is useful: the first phase is about creating familiar structures and setting priorities for the current situation. Familiar structures and priorities are a suitable means of avoiding operational hectic. The second phase is about the actual work of managing the situation.

During the crisis management, it is necessary to stabilise those involved in the solution; as time goes on, this group is expanded to include other affected parties. Measures from trauma research provide further insights into how fears associated with crises and catastrophes, which block the ability to act, can be reduced.

Ultimately, crisis management requires a learning organisation – both in terms of lessons learned after the crisis and in terms of learning by doing during the crisis itself. I believe that it is essential to positively occupy and establish this culture in companies if we want to meet the challenges of our entrepreneurial future.

Notes (some in German):

[1] Zeitschriftenaufsatz Organisationale Resilienz – wie Unternehmen Krisen erfolgreich bewältigen koennen, Danner-Schröder, D. Geiger 2016, Fuehrung + Organisation, Vol. 85, 3, S. 201-208

[2] The appropriate teams should be named on the basis of their expertise and experience and not (exclusively) on the basis of ‘company policy’ circumstances. And clear and operationally simple rules for the composition of the teams and possible project structures should be created BEFORE the crisis occurs. Also in advance, potential members of the teams should train uncertainty skills with a focus on advanced perception and perceived safety.

For more on uncertainty skills and the relevance of perceived safety, see ‘What we can learn from starship Enterprise’ and Smartpedia: Uncertainty.

[3] A traumatising event is not completely stored in the brain as a past event and can therefore lead to the traumatic event being relived when a moment from the experience at the time, such as a smell or a colour impulse, occurs. This is a kind of film in the brain that cannot be distinguished from reality by those affected.

[4] The amygdala triggers a reduction in anxiety as soon as we act, regardless of whether our actions are purposefully directed or rather hectically undirected.

Here you will find a template for documenting lessons learned.

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Astrid Kuhlmey has published more articles in the t2informatik blog, including:

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